Tax Issues in M&A

Part 1

Advising the Purchasers

• Purchase of shares or trade?

• This M&A tax session explores capital allowances considerations, particularly fixtures in buildings

• Intangible assets Restriction on tax relief for goodwill and customer-related intangibles

Group structures for losses and capital gains purposes

Taking advantage of trading losses in the target

Financing the transaction

• Tax relief for interest costs

Tax relief for professional fees

Stamp Duty and Stamp Duty Land Tax considerations

Advising Individual Vendors

• The diminishing importance of Capital Gains Tax (CGT) business asset disposal relief (BADR) Qualifying companies and shares

• Changes in recent Finance Acts

Tax treatment of consideration

• cash, shares

• loan notes (qualifying and non-qualifying)

• Earn-outs Marren v Ingles principles

Part 2

Warranties and Indemnities

• M&A tax issues include the key points to cover in a sale and purchase agreement (SPA)

• Transactions in securities: anti-avoidance rules Key points

• Cases

Advising Corporate Vendors

• Pre-sale planning Group reorganisations

• Hive-downs

• Demergers

• Case study on a capital reduction demerger

• Depreciatory transactions

HMRC Clearances, in particular

• Section 138 TCGA 1992 re capital gains

• Autumn 2025 Finance Bill changes to reconstruction relief anti-avoidance Case study of a buy-out in a succession planning context

Tax Issues affecting employee shares

• An overview of Employment-related securities (ERS) rules is covered in this M&A tax course and includes: restricted securities and s.431 elections

• convertible securities

• Earn-out considerations

Training Objectives

Participants attending this training will cover the following topics surrounding M&A tax:

• The key tax issues affecting purchasers, including: Capital allowances

• Stamp taxes

• Tax relief for financing costs

• Tax relief on intangible assets

• Anti-avoidance when buying a loss-making company

The key issues affecting vendors, including:

• the tax treatment of various forms of consideration, such as loan notes or earn-outs

Corporate reorganisations:

• Group tax rules

• Hive-downs

• Demergers

The importance of obtaining HMRC clearances

Other compliance points (e.g. warranties and indemnities)

M&A tax issues affecting employee shares and options (an overview rather than detail)

Training Course Summary

There are a huge number of tax issues to consider across a range of taxes when dealing with company purchases and disposals. At Redcliffe Training, our M&A tax course will look at transactions from both the purchaser’s and vendor’s perspectives and consider both individual and corporate owners.

Emphasis is on the unexpected tax charges that can catch the unwary, along with the reliefs available when deals are planned and structured tax-efficiently. Key compliance areas, such as warranties and obtaining HMRC clearances, will also be discussed.

To aid delegates’ understanding, the course material will include numerous numerical examples.

PLEASE NOTE: This is the detailed outline for a Public M&A tax course delivered online. For an in-house live presentation, sections can be expanded or deleted to suit your bespoke requirements.